IBEX targets biggest weekly drop in nine months pending US jobs data

Spain’s IBEX 35 stock index was heading for its biggest weekly drop in nine months on Friday, amid a cautious backdrop as investors await US job creation data.

Investors’ attention will be focused on the US employment report to be released at 14:30 Spanish time (1230 GMT) because it could provide clues about the timing of the Federal Reserve’s (Fed) rate cut.

On Wednesday, the Fed ruled out raising interest rates again, but its chairman, Jerome Powell, predicted that the first cut could be a long time coming due to the strength of the US economy, which is preventing the cooling of persistent inflation.

Nevertheless, markets have received positive news on the price front with the recent decline in fuel costs, whose previous rise threatened to fuel a resurgence in inflation.

Although oil prices advanced on Friday on the prospect of an OPEC+ production cut, they were heading for their biggest weekly losses in three months amid the easing of tensions in the Middle East due to progress in talks between Israel and Hamas in Egypt.

Elsewhere, market players were still tracking movements in the yen, which, with shades of intervention, was trading Friday at 152.99 to the dollar, having started the week touching a 34-year low of 160.24 to the dollar on Monday. The moves pushed the dollar lower even against other peers such as the pound sterling or the euro.

In Spain, investors await today the IPO of Puig, the fashion and perfumery group with brands such as Carolina Herrera or Paco Rabanne, with a price per share of 24.50 euros. It is the biggest IPO in Spain in almost a decade.

At 07:07 GMT on Friday, the selective Spanish stock market index IBEX 35 was up 16.70 points, or 0.15%, to 10,888.70 points, while the FTSE Eurofirst 300 index of large European stocks was up 0.26%.

For the week as a whole, the index was heading for a drop of 2.46%, the biggest weekly decline since the period between July 29 and August 4, 2023.

In the banking sector, Santander was up 0.28%, BBVA was up 0.67%, Caixabank was up 0.61%, Sabadell was down 0.8%, Bankinter was up 0.45%, and Unicaja Banco was up 0.16%.

Among the large non-financial stocks, Telefónica gained 0.35%, Inditex advanced 0.42%, Iberdrola gained 0.22%, Cellnex was flat, and the oil company Repsol rose 0.21%.

(Information by Javi West Larrañaga; edited by Tomás Cobos)